Grist for the Machine

Grist

Much like publishers, employees at the big tech monopolies can end up little more than grist.

Products & product categories come & go, but even if you build “the one” you still may lose everything in the process.

Imagine building the most successful consumer product of all time only to realize:’The iPhone is the reason I’m divorced,’ Andy Grignon, a senior iPhone engineer, tells me. I heard that sentiment more than once throughout my dozens of interviews with the iPhone’s key architects and engineers.’Yeah, the iPhone ruined more than a few marriages,’ says another.

“There’s been essentially no dispersion of tech jobs,’ said Mr. Kolko, who conducted the research.’Which metro is the next Silicon Valley? The answer is none, at least for the foreseeable future. Silicon Valley still stands apart.’

Making $180,000 a year can price one out of the local real estate market, requiring living in a van or a two hour commute. An $81,000 salary can require a 3 hour commute.

The hype surrounding transformative technology that disintermediates geography & other legacy restraints only lasts so long: “The narrative isn’t the product of any single malfunction, but rather the result of overhyped marketing, deficiencies in operating with deep learning and GPUs and intensive data preparation demands.”

A manager named LFEditorCat told the raters in chat that the pay cut had come at the behest of’Big G’s lawyers,’ referring to Google. Later, a rater asked Jackson,’If Google made this change, can Google reverse this change, in theory?’ Jackson replied,’The chances of this changing are less than zero IMO.’

America really is undergoing a radical change in the structure of our political economy. And yet this revolutionary shift of power, control, and wealth has remained all but unrecognized and unstudied … Since the 1990s, large companies have increasingly relied on temporary help to do work that formerly was performed by permanent salaried employees. These arrangements enable firms to hire and fire workers with far greater flexibility and free them from having to provide traditional benefits like unemployment insurance, health insurance, retirement plans, and paid vacations. The workers themselves go by many different names: temps, contingent workers, contractors, freelancers. But while some fit the traditional sense of what it means to be an entrepreneur or independent business owner, many, if not most, do not-precisely because they remain entirely dependent on a single power for their employment.

Dedication & devotion are important traits. Are you willing to do everything you can to go the last mile? “Lyft published a blog post praising a driver who kept picking up fares even after she went into labor and was driving to the hospital to give birth.”

About 1.8 million workers were out of the labor force for “other” reasons at the beginning of this year, meaning they were not retired, in school, disabled or taking care of a loved one, according to Atlanta Federal Reserve data. Of those people, nearly half — roughly 881,000 workers — said in a survey that they had taken an opioid the day before, according to a study published last year by former White House economist Alan Krueger.”

After a few years of buildup, Obamacare kicked the scams into high gear. …. With exchange plans largely locked into paying for medically required tests, patients (and their urine) became gold mines. Some labs started offering kickbacks to treatment centers, who in turn began splitting the profits with halfway houses that would tempt clients with free rent and other services. … Street-level patient brokers and phone room lead generators stepped up to fill the beds with strategies across the ethical spectrum, including signing addicts up for Obamacare and paying their premiums.

When platform monopolies dictate the roll-out of technology, there is less and less innovation, fewer places to invest, less to invent. Eventually, the rhetoric of innovation turns into DISRUPT, a quickly canceled show on MSNBC, and Juicero, a Google-backed punchline.

This moment of stagnating innovation and productivity is happening because Silicon Valley has turned its back on its most important political friend: antitrust. Instead, it’s embraced what it should understand as the enemy of innovation: monopoly.

It is the aspie guy getting fired for not understanding the full gender “spectrum.”

Google exploits the mental abilities of its aspie workers but lets them burn at the stake when its disability, too much honesty, manifests. pic.twitter.com/Sd1A0KJvc0— Julian Assange (@JulianAssange) August 15, 2017

It is the repression of truth: “Truth equals virtue equals happiness. You cannot solve serious social problems by telling lies or punishing people who tell truth.”

Most meetings at Google are recorded. Anyone at Google can watch it. We’re trying to be really open about everything…except for this. They don’t want any paper trail for any of these things. They were telling us about a lot of these potentially illegal practices that they’ve been doing to try to increase diversity. Basically treating people differently based on what their race or gender are. – James Damore

In a set of guidelines issued to Google evaluators in March, elaborated in April by Google VP of Engineering Ben Gomes, the company instructed its search evaluators to flag pages returning’conspiracy theories’ or’upsetting’ content unless’the query clearly indicates the user is seeking an alternative viewpoint.’ The changes to the search rankings of WSWS content are consistent with such a mechanism. Users of Google will be able to find the WSWS if they specifically include’World Socialist Web Site’ in their search request. But if their inquiry simply includes term such as’Trotsky,”Trotskyism,”Marxism,”socialism’ or’inequality,’ they will not find the site.

Under its new so-called anti-fake-news program, Google algorithms have in the past few months moved socialist, anti-war, and progressive websites from previously prominent positions in Google searches to positions up to 50 search result pages from the first page, essentially removing them from the search results any searcher will see. Counterpunch, World Socialsit Website, Democracy Now, American Civil liberties Union, Wikileaks are just a few of the websites which have experienced severe reductions in their returns from Google searches.

What does the above say about tech monopolies wanting to alter the structure of society when their internal ideals are based on fundamental lies? They can’t hold an internal meeting addressing sacred cows because “ultimately the loudest voices on the fringes drive the perception and reaction” but why not let them distribute swarms of animals with bacteria & see what happens? Let’s make Earth a beta.

FANG

The more I study the macro picture the more concerned I get about the long term ramifications of a financially ever more divergent society. pic.twitter.com/KoY60fAfe2— Sven Henrich (@NorthmanTrader) August 9, 2017

Over the past three decades, the U.S. government has permitted corporate giants to take over an ever-increasing share of the economy. Monopoly-the ultimate enemy of free-market competition-now pervades every corner of American life … Economic power, in fact, is more concentrated than ever: According to a study published earlier this year, half of all publicly traded companies have disappeared over the past four decades.

One publisher said its Facebook-monetized videos had an average CPM of 15 cents. A second publisher, which calculated ad rates based on video views that lasted long enough to reach the ad break, said the average CPM for its mid-rolls is 75 cents. A third publisher made roughly $500 from more than 20 million total video views on that page in September.

That’s how monopolies work. Whatever is hot at the moment gets pitched as the future, but underneath the hood all compliments get commoditized:

as a result of this increased market power, the big superstar companies have been raising their prices and cutting their wages. This has lifted profits and boosted the stock market, but it has also held down real wages, diverted more of the nation’s income to business owners, and increased inequality. It has also held back productivity, since raising prices restricts economic output.

If in five years I’m just watching NFL-endorsed ESPN clips through a syndication deal with a messaging app, and Vice is just an age-skewed Viacom with better audience data, and I’m looking up the same trivia on Genius instead of Wikipedia, and’publications’ are just content agencies that solve temporary optimization issues for much larger platforms, what will have been point of the last twenty years of creating things for the web?

We’ve been in the celebration phase all year as Microsoft, Google, Amazon, Apple, Netflix and Facebook take their place in the pantheon of classic American monopolists. These firms and a few others, it is now widely acknowledged, dominate everything. There is no day-part in which they do not dominate the battle for consumers’ attention. There is no business safe from their ambitions. There are no industries in which their influence and encroachment are not currently being felt.

The web shifts information-based value chains to universal distribution at zero marginal cost, which shifts most of the value extraction to the attention merchants.

despite a user base near the size of Instagram’s, Tumblr never quite figured out how to make money at the level Facebook has led managers and shareholders to expect … running a platform for culture creation is, increasingly, a charity operation undertaken by larger companies. Servers are expensive, and advertisers would rather just throw money at Facebook than take a chance

Those resting in the shadows of the giants will keep getting crushed: “They let big tech crawl, parse, and resell their IP, catalyzing an extraordinary transfer in wealth from the creators to the platforms.”

“Facebook has embraced the healthy gross margins and influence of a media firm but is allergic to the responsibilities of a media firm,” Mr. Galloway says. … For Facebook, a company with more than $14 billion in free cash flow in the past year, to say it is adding 250 people to its safety and security efforts is’pissing in the ocean,’ Mr. Galloway says.’They could add 25,000 people, spend $1 billion on AI technologies to help those 25,000 employees sort, filter and ID questionable content and advertisers, and their cash flow would decline 10% to 20%.’

Practically speaking, bypassing DRM isn’t hard (Google’s version of DRM was broken for six years before anyone noticed), but that doesn’t matter. Even low-quality DRM gets the copyright owner the extremely profitable right to stop their customers and competitors from using their products except in the ways that the rightsholder specifies. … for a browser to support EME, it must also license a “Content Decryption Module” (CDM). Without a CDM, video just doesn’t work. All the big incumbents advocating for DRM have licenses for CDMs, but new entrants to the market will struggle to get these CDMs, and in order to get them, they have to make promises to restrict otherwise legal activities … We’re dismayed to see the W3C literally overrule the concerns of its public interest members, security experts, accessibility members and innovative startup members, putting the institution’s thumb on the scales for the large incumbents that dominate the web, ensuring that dominance lasts forever.

More significantly, the GDPR extends the concept of’personal data’ to bring it into line with the online world. The regulation stipulates, for example, that an online identifier, such as a device’s IP address, can now be personal data. So next year, a wide range of identifiers that had hitherto lain outside the law will be regarded as personal data, reflecting changes in technology and the way organisations collect information about people. … Facebook and Google should be OK, because they claim to have the’consent’ of their users. But the data-broking crowd do not have that consent.

Oath’s video unit, however, had begun doubling down on the type of highly shareable,’snackable’ bites that people gobble up on their smartphones and Facebook feeds. … . What frustrates her like nothing else, two people close to Couric told me, is when she encounters fans and they ask her what she’s up to these days.

When content is atomized into the smallest bits & recycling is encouraged only the central network operators without editorial content costs win.

Some suggest the repackaging and reposting of ads highlights the’pivot to video’ mentality many publishers now demonstrate. The push to churn out video content to feed platforms and to attract potentially lucrative video advertising is increasingly viewed as a potential solution to an increasingly challenging business model problem.

Publishers might also get paid a commission on any sales they help drive by including affiliate links alongside the videos. If these links drive users to purchase the products, then the publisher gets a cut.

Is there any chance recycling low quality infomercial styled ads as placeholder auto-play video content to run prerolls on is a sustainable business practice?

If that counts as strategic thinking in online publishing, count me as a short.

For years whenever the Adobe Flash plugin for Firefox had a security update users who hit the page got a negative option install of Google Chrome as their default web browser. And Google constantly markets Chrome across their properties:

Google is aggressively using its monopoly position in Internet services such as Google Mail, Google Calendar and YouTube to advertise Chrome. Browsers are a mature product and its hard to compete in a mature market if your main competitor has access to billions of dollars worth of free marketing.

It only takes a single yes on any of those billions of ad impressions (or an accidental opt in on the negative option bundling with security updates) for the default web browser to change permanently.
There’s no way Mozilla can compete with Google on economics trying to buy back an audience.

Mozilla is willing to buy influence, too – particularly in mobile, where it’s so weak. One option is paying partners to distribute Firefox on their phones.’We’re going to have to put money toward it,’ Dixon says, but she expects it’ll pay off when Mozilla can share revenue from the resulting search traffic.

They have no chance of winning when they focus on wedge issues like fake news. Much like their mobile operating system, it is a distraction. And the core economics of paying for distribution won’t work either. How can Mozilla get a slice of an advertiser’s ad budget through Yahoo through Bing & compete against Google’s bid?

Google is willing to enter uneconomic deals to keep their monopoly power. Look no further than the $1 billion investment they made in AOL which they quickly wrote down by $726 million.

Google pays Apple $3 billion PER YEAR to be the default search provider in Safari. Verizon acquired Yahoo! for $4.48 billion. There’s no chance of Yahoo! outbidding Google for default Safari search placement & if Apple liked the idea they would have bought Yahoo!. It is hard to want to take a big risk & spend billions on something that might not back out when you get paid billions to not take any risk.

Even Microsoft would be taking a big risk in making a competitive bid for the Apple search placement. Microsoft recently disclosed “Search advertising revenue increased $124 million or 8%.” If $124 million is 8% then their quarterly search ad revenue is $1.674 billion. To outbid Google they would have to bid over half their total search revenues.

Regulatory Capture

“I have a foreboding of an America in which my children’s or grandchildren’s time – when the United States is a service and information economy; when nearly all the key manufacturing industries have slipped away to other countries; when awesome technological powers are in the hands of a very few, and no one representing the public interest can even grasp the issues; when the people have lost the ability to set their own agendas or knowledgeably question those in authority; when, clutching our crystals and nervously consulting our horoscopes, our critical faculties in decline, unable to distinguish between what feels good and what’s true, we slide, almost without noticing, back into superstition and darkness. The dumbing down of america is most evident in the slow decay of substantive content in the enormously influential media, the 30-second sound bites (now down to 10 seconds or less), lowest common denominator programming, credulous presentations on pseudoscience and superstition, but especially a kind of celebration of ignorance.” – Carl Sagan, The Demon-haunted World, 1996

Remember how Google engineers repeatedly announced how people who bought or sold links without clear machine & human readable disclosure are scum? One way to take .edu link building to the next level is to sponsor academic research without disclosure:

Some researchers share their papers before publication and let Google give suggestions, according to thousands of pages of emails obtained by the Journal in public-records requests of more than a dozen university professors. The professors don’t always reveal Google’s backing in their research, and few disclosed the financial ties in subsequent articles on the same or similar topics, the Journal found. … Google officials in Washington compiled wish lists of academic papers that included working titles, abstracts and budgets for each proposed paper-then they searched for willing authors, according to a former employee and a former Google lobbyist. … Mr. Sokol, though, had extensive financial ties to Google, according to his emails obtained by the Journal. He was a part-time attorney at the Silicon Valley law firm of Wilson Sonsini Goodrich & Rosati, which has Google as a client. The 2016 paper’s co-author was also a partner at the law firm, which didn’t respond to requests for comment.

As bad as that is, Google has non profit think tanks fire ENTIRE TEAMS if they suggest regulatory action against Google is just:

“We are in the process of trying to expand our relationship with Google on some absolutely key points,’ Ms. Slaughter wrote in an email to Mr. Lynn, urging him to’just THINK about how you are imperiling funding for others.’

“What happened has little to do with New America, and everything to do with Google and monopoly power. One reason that American governance is dysfunctional is because of the capture of much academic and NGO infrastructure by power. That this happened obviously and clumsily at one think tank is not the point. The point is that this is a *system* of power. I have deep respect for the scholars at New America and the work done there. The point here is how *Google* and monopolies operate. I’ll make one other political point about monopoly power. Democracies all over the world are seeing an upsurge in anger. Why? Scholars have tended to look at political differences, like does a different social safety net have an impact on populism. But it makes more sense to understand what countries have in common. Multi-nationals stretch over… multiple nations. So if you think, we do, that corporations are part of our political system, then populism everywhere monopolies operate isn’t a surprise. Because these are the same monopolies. Google is part of the American political system, and the European one, and so on and so forth.” – Matt Stoller

in recent years, Google has become greedy about owning not just search capacities, video and maps, but also the shape of public discourse. As the Wall Street Journal recently reported, Google has recruited and cultivated law professors who support its views. And as the New York Times recently reported, it has become invested in building curriculum for our public schools, and has created political strategy to get schools to adopt its products. This year, Google is on track to spend more money than any company in America on lobbying.

“I just got off the phone with Eric Schmidt and he is pulling all of his money.” – Anne-Marie Slaughter

Google’s director of policy communications, Bob Boorstin, emailed the Rose Foundation (a major funder of Consumer Watchdog) complaining about Consumer Watchdog and asking the charity to consider “whether there might be better groups in which to place your trust and resources.”

Six years ago, I was pressured to unpublish a critical piece about Google’s monopolistic practices after the company got upset about it. In my case, the post stayed unpublished. I was working for Forbes at the time, and was new to my job.
…
Google never challenged the accuracy of the reporting. Instead, a Google spokesperson told me that I needed to unpublish the story because the meeting had been confidential, and the information discussed there had been subject to a non-disclosure agreement between Google and Forbes. (I had signed no such agreement, hadn’t been told the meeting was confidential, and had identified myself as a journalist.)

“You’re already asking very difficult questions to Mr. Juncker,’ the YouTube employee said before Birbes’ interview in an exchange she captured on video.’You’re talking about corporate lobbies. You don’t want to get on the wrong side of YouTube and the European Commissionâ€¦ Well, except if you don’t care about having a long career on YouTube.’

As more and more of the economy become sown up by monopolistic corporations, there are fewer and fewer opportunities for entrepreneurship. … By design, the private business corporation is geared to pursue its own interests. It’s our job as citizens to structure a political economy that keeps corporations small enough to ensure that their actions never threaten the people’s sovereignty over our nation.

Google controls upwards of 80 percent of global search-and the capital to either acquire or crush any newcomers. They are bringing us a hardly gilded age of prosperity but depressed competition, economic stagnation, and, increasingly, a chilling desire to control the national conversation.

The switch is partly related to Google’s transformation from a listed public company into a business owned by a holding company.Â The change helps keep potential challenges in one business from spreading to another, according to Dana Hobart, a litigator with the Buchalter law firm in Los Angeles.

Isn’t that an admission they should be broken up?

Early Xoogler Doug Edwards wrote: “[Larry Page] wondered how Google could become like a better version of the RIAA – not just a mediator of digital music licensing – but a marketplace for fair distribution of all forms of digitized content.”

In an explosive new allegation, a renowned architect has accused Google of racketeering, saying in a lawsuit the company has a pattern of stealing trade secrets from people it first invites to collaborate. …’It’s cheaper to steal than to develop your own technology,’ Buether said.’You can take it from somebody else and you have a virtually unlimited budget to fight these things in court.’ …’It’s even worse than just using the proprietary information – they actually then claim ownership through patent applications,’ Buether said.

Google’s efforts to monopolize civil society in support of the company’s balance-sheet-driven agenda is as dangerous as it is wrong. For years, we have watched as Google used its monopoly powers to hurt artists and music creators while profiting off stolen content. For years, we have warned about Google’s actions that stifle the views of anyone who disagrees with its business practices, while claiming to champion free speech.

“The 160-page critique, which was supposed to remain private but was inadvertently disclosed in an open-records request, concluded that Google’s ‘conduct has resulted – and will result – in real harm to consumers.’ ” But Google was never penalized, because the political appointees overrode the staff recommendation, an action rarely taken by the FTC. The Journal pointed out that Google, whose executives donated more money to the Obama campaign than any company, had held scores of meetings at the White House between the time the staff filed its report and the ultimate decision to drop the enforcement action.

Some scrappy (& perhaps masochistic players) have been fighting the monopoly game for over a decade:

For many years Google has “manipulated search results to favor its own comparison-shopping service. … Google both demotes competitors’ offerings in search rankings and artificially inserts its own service in a box above all other search results, regardless of their relevance.”

After losing for over a decade, on the 27th of June a win was finally delivered when the European Commission issued a manual action to negate the spam, when they fined Google â‚¬2.42 billion for abusing dominance as search engine by giving illegal advantage to own comparison shopping service.

“What Google has done is illegal under EU antitrust rules. It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation.” – Margrethe Vestager

Quoting internal Google documents and emails, the report shows that the company created a list of rival comparison shopping sites that it would artificially lower in the general search results, even though tests showed that Google users’liked the quality of the [rival] sites’ and gave negative feedback on the proposed changes. Google reworked its search algorithm at least four times, the documents show, and altered its established rating criteria before the proposed changes received’slightly positive’ user feedback. … Google’s displayed prices for everyday products, such as watches, anti-wrinkle cream and wireless routers, were roughly 50 percent higher – sometimes more – than those on rival sites. A subsequent study by a consumer protection group found similar results. A study by the Financial Times also documented the higher prices.

The competitors who were slaughtered by monopolistic bundling won’t recover‘The damage has been done. The industry is on its knees, and this is not going to put it back,’ said Mr. Stables, who has decided to participate in Google’s new auctions despite misgivings.’I’m sort of shocked that they’ve come out with this,’ he added.

“Monopolists can improve their products to better serve their customers just like any other market participant” <– FTC Chair just said this— Matt Stoller (@matthewstoller) September 12, 2017

The Fight Against Rising (& Declining) Nationalism

As a global corporation above & beyond borders, Google has long been against nationalism. Eric Schmidt’s Hillary Clinton once wrote: “My dream is a hemispheric common market, with open trade and open borders, some time in the future with energy that is as green and sustainable as we can get it, powering growth and opportunity for every person in the hemisphere.”

We are writing to express our deep concerns about the European Union’s aggressive and heavy-handed antitrust enforcement action against American companies. It has become increasingly clear that, rather than being grounded in a transparent legal framework, these various investigations and complaints are being driven by politics and protectionist policies that harm open-competition practices, consumers, and unfairly target American companies,.

The above nonsense was in spite of Yelp carrying a heavy load.

The lion’s share of work on EU case was advanced by US companies who had to go to Europe after a politically captured FTC failed them. 6/x— Luther Lowe (@lutherlowe) June 26, 2017

Yelp celebrated the victory: “Google has been found guilty of engaging in illegal conduct with the aim of promoting its vertical search services. Although the decision addresses comparison shopping services, the European Commission has also recognized that the same illegal behavior applies to other verticals, including local search.”

It’s not a’grudge.’ Extractive platforms competing with their ecosystem is the Achilles heel of the entire economy https://t.co/uLKSLC6vQy— Tim O’Reilly (@timoreilly) July 2, 2017